More than $2.8 million seized in Las Vegas as part of gambling probe

By Las Vegas Sun Staff (contact)

Published Thursday, Oct. 25, 2012 | 10:10 a.m.

Updated Thursday, Oct. 25, 2012 | 4:49 p.m.

More than $2.8 million in cash and casino chips have been seized or secured in Las Vegas and 25 people arrested as part of a probe into a nationwide illegal sports betting ring with ties to organized crime, Nevada gaming officials said.

Eight people from the Las Vegas area were among those arrested, most prominently Michael Colbert, the race and sports director for Cantor Gaming and sports book manager at the M Resort in Henderson.

Seven homes were searched Wednesday, and wagering accounts and safe deposit boxes were either searched or frozen, the Nevada Gaming Control Board said in a statement Thursday, the day after the news broke.

Others arrested in Clark County on New York warrants were Brandt England, 49; Jerald Branca, 67; Joseph Paulk, 35; Steven Diano, 48; Ian W. Mandel, 43; and Kelly Barsel, 42, all of Las Vegas; and Paul Sexton, 29, of Henderson.

England was identified in court records as the Las Vegas owner of Pinnacle Sports, one of three websites prosecutors in New York say were used as offshore "wire rooms" that made and collected illegal bets.

Diano, Branca, Barsel, Paulk and England are charged as illegal bookmakers in the criminal enterprise that officials say made $50 million from April 13, 2011 to Oct. 18. Sexton is charged as a money collector in the organization.

Prosecutors say bookmakers oversaw agents who recruited clients to make wagers on the websites. Colbert is accused of helping build those client lists for the illegal betting.

Colbert, who was arrested Wednesday morning at his home, is charged with enterprise corruption, conspiracy to operate illegal gambling enterprise and three counts of money laundering. The indictment alleges he arranged for the transfer of $100,000 in gambling proceeds between Las Vegas and New York in July 2011.

Colbert was one of the original employees of Cantor Gaming, which formed as an affiliate of financial services firm Cantor Fitzgerald L.P. four years ago.

Cantor rents parts of seven properties — the Palms, Venetian, Palazzo, Cosmopolitan, Hard Rock, Tropicana and the M Resort — to run the their sports book operations.

Cantor’s start in Las Vegas came in March 2009 with the opening of the M Resort, where Colbert served as the sports book director. His primary duties were posting, monitoring and moving betting lines on all sports.

Cantor revolutionized the sports betting industry in Nevada, with Colbert as its most visible face while at the M Resort. The company became the first to receive a license to run a mobile gaming system and to offer in-running wagering that allows bettors to gamble on a game while it’s happening.

Cantor, more importantly, accepted bigger wagers than any other sports books, which caused high rollers and professional sports bettors to flock to the M Resort. Colbert was always outspoken in interviews, proclaiming a willingness to take any bet without the strict limits at the rest of the shops in Las Vegas.

Cantor officials estimated the company was responsible for 15 percent of the nearly $3 billon wagered on sports statewide in 2010. Colbert’s profile grew as Cantor’s success reached new levels.

Although Colbert stayed based out of the M Resort, he also was in charge of the oddsmaking for all of Cantor Gaming’s empire.

He was readily accessible to media, routinely analyzing games and betting patterns to a slew of both national and local outlets.

Colbert was inventive with the betting options offered by Cantor. Along with an ever-increasing slate of in-running games, for example, Cantor unveiled a fantasy-sports wagering alternative for basketball and football earlier this year.

Cantor is the Nevada sports book most competitive with illegal offshore shops, which can post significantly more opportunities bet on than a traditional brick-and-mortar casino that must receive approval from the Nevada Gaming Control Board.

England, meanwhile, has been linked to offshore Internet gambling investigations before.

In 2007, Metro Police raided his home and the homes of two other gamblers, Michael V. Buono Sr. and his son, Michael A. Buono, using warrants from Maricopa County, Ariz., related to an investigation there. The search warrant in that case authorized police to seize "bookmaking paraphernalia,'' such as betting records, bettors' contact information, cash, gambling chips and other items.

Arizona officials ultimately dismissed the charges against all three men.

Sexton and Diano are both tournament poker players. Sexton has won almost $240,000 in 16 tournaments, according to a profile on Poker Pages, while Diano has won almost $300,000 in eight tournaments.

Diano wrote on his profile page that he started playing poker at an early age; that his hobbies are playing poker and making love; that the poker players he admires are Phil Ivey, Phil Hellmuth and Doyle Brunson; and that his life’s ambition is “to play free poker on tilt and talk to all the cute railbirds.”

Earlier this month, the District Attorney’s Office in Queens County, New York, presented its case to a grand jury, which returned a 259-page indictment charging 25 people with 225 counts, including enterprise corruption, money laundering, promoting gambling and conspiracy.

The Gaming Control Board said its agents worked with New York authorities for 15 months on the operation, dubbed “World Wide Wagers” by the New York Police Department’s Organized Crime Control Bureau.

In their investigation, which began in 2011, the NYPD discovered a large-scale bookmaking operation, with ties to traditional organized crime, operating in several states, as well as at offshore locations, officials said.

They also determined that there was a significant Las Vegas connection and contacted the Gaming Control Board for assistance.

The Enforcement Division’s Special Investigation Section’s primary responsibility in the investigation was to conduct surveillance on known suspects, identify unknown subjects, observe money drops and exchanges, and identify accounts and safe deposit boxes being utilized by the suspects, the board said.

The Gaming Control Board is continuing its investigation into potential statutory and regulatory violations in Nevada.

“Our investigation into this is ongoing and will involve any business holding a gaming license in the state — and that would include Cantor Gaming,” said Jerry Markling, chief of enforcement for the Nevada Gaming Control Board.

A spokeswoman for Cantor Gaming said Colbert’s arrest has not impacted the company's operations. Cantor runs race and sports books at seven Las Vegas resorts.

"This case relates to Mike Colbert as an individual and not to Cantor Gaming," Hannah Sloane said. "This case does not involve Cantor gaming, and we're still conducting business as usual."